CFO Retreat 2017 RESEARCH RESULTS. Leading Through Uncertainty

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1 CFO Retreat 2017 RESEARCH RESULTS Leading Through Uncertainty

2 " This research, conducted at our CFO Retreat 2017, gives us some fascinating insight into the challenges CFOs are facing in the current climate and whether they are getting the right support in order to embrace their roles as leaders. Interestingly, 84% felt that they needed to strengthen the leadership capability of the finance function in response to greater demand for strategic input and 92% said they felt more investment should be allocated to leadership development rather than bringing in external talent. The message to emerge from these findings is loud and clear: senior executives do understand the value of leadership development and mentoring, but they are being consumed by day-to-day tasks and responsibilities. Consequently, they are not focusing on team cohesion and long-term strategy something that is supported by the anonymous comments from respondents which are also included in this research. As well as the data collected at the Retreat, the following report includes comments from leading CFOs on the challenges and opportunities they are facing. Jamie Wilson Managing Director, Criticaleye 2018 Criticaleye All Rights Reserved

3 Findings from Criticaleye s CFO Retreat 2017 Survey 92% say more should be spent on leadership development and support for senior executives, as opposed to headhunters 85% of CFOs say they are grappling with business model disruption 92% of CFOs say that external mentoring improves the performance of senior executives Almost a quarter (23%) of CFOs think the Chairman does not add value in terms of supporting the executive team 2018 Criticaleye All Rights Reserved

4 How confident are you that the global economy will grow over the next 12 months? 12% 4% 19% Extremely confident 19% There are far too many alarm bells ringing that suggest market confidence is reducing CFO Research Participant 65% 73% Fairly confident 65% Not very confident 12% The global economy will shrink 4% How confident are you that the UK economy will grow over the next 12 months? 8% 20% Extremely confident 0% Fairly confident 20% Not very confident 72% 73% The UK economy will shrink 8% 72% 2018 Criticaleye All Rights Reserved 4

5 Is the senior leadership team currently grappling with business model disruption? 15% 85% of CFOs say they are grappling with business model disruption, but only 19% believe their senior leadership team has the ability to tackle this challenge 85% Yes 85% No 15% Does the senior leadership team have the ability to respond to business model disruption? 8% 4% 19% To a great extent 19% To some extent 69% To a minor extent 8% Not at all 4% 69% 2018 Criticaleye All Rights Reserved 5

6 Are the Chairman, CEO and CFO aligned on strategy? 15% The CEO/CFO alignment really works well when the HRD is also on the same page and there is a triangle of trust and strategic thinking 85% Yes 85% No 15% Does the executive team have the ability to execute on the medium to long-term strategy? CFO Research Participant 27% 19% To a great extent 19% To some extent 54% To a minor extent 27% 54% 2018 Criticaleye All Rights Reserved 6

7 Is the management team too inward-looking and focused on the day-to-day? 96% of CFOs say the To a great extent To some extent 34% 54% management team is To a minor extent 8% too inward-looking Not at all 4% Executives should always be looking to learn and reference their performance and that of their business against others Is business performance enhanced if executives have access to reference points outside of their organisation / sector? CFO Research Participant To a great extent 65% To some extent 35% Not at all 0% 2018 Criticaleye All Rights Reserved 7

8 Almost one in four (23%) CFOs say their Chairman does not add value in terms of supporting the goals and objectives of the executive team Does your Chairman add value in terms of supporting the goals and objectives of the executive team? 23% 73% 77% Yes 77% No 23% 2018 Criticaleye All Rights Reserved 8

9 Why do management teams become too focused on short-term goals? All of these factors can 60% have an impact, although I typically believe that people return to type and what they know 24% when pressure comes on 12% or they lose confidence 4% CFO Research Participant Management team is too tactical, rather than strategic Pressure to provide a return to investors Certain bonus and incentive schemes encourage short-term thinking Overload of corporate reporting 2018 Criticaleye All Rights Reserved 9

10 CFOs ranked the primary reasons for failure in the management team 1 NOT ENOUGH TIME SPENT DISCUSSING STRATEGY 2 AFRAID TO CHALLENGE & SPEAK OPENLY 3 POOR COMMUNICATION & PEOPLE SKILLS 4 LACK OF TRUST 5 NO ALIGNMENT ON KEY OBJECTIVES 6 SUBSTANDARD INTERNAL CONTROLS & REPORTING 2018 Criticaleye All Rights Reserved

11 Do silos within an organisation have a negative impact on business performance? 12% If there is triangulation and talking behind one s back, rather than direct discussion and building trust, then silos will develop 88% 73% Yes 88% No 12% To what extent do the behaviours of the executive team reinforce silos within the business? 12% CFO Research Participant 15% 42% To a great extent 42% To some extent 31% To a minor extent 15% Not at all 12% 31% 2018 Criticaleye All Rights Reserved 11

12 In your view, should more be spent on leadership development and support for senior executives, as opposed to headhunters? CFOs overwhelmingly agree (92%) that more budget should be allocated to leadership development than headhunters and yet, 76% say organisations are still spending more on headhunters 8% 73% 92% Yes 92% No 8% In your experience, on which of the following do organisations spend more? 24% Headhunters / recruitment for senior executive roles 76% 73% 76% Leadership development & support for senior executives 24% 2018 Criticaleye All Rights Reserved 12

13 Is leadership development enough of a priority for senior teams? 84% of CFOs believe they need to strengthen the leadership capability of the finance function Under half of CFOs (46%) say they invest enough in leadership development and make it a priority 27% of CFOs say they discussed leadership development once a year or less with their HR Director Mentoring and learning from peers are cited as the most effective leadership development tools for senior executives by CFOs 2018 Criticaleye All Rights Reserved

14 CFOs reveal key areas where CEOs and HRDs need to improve CEOs 1. BUILDING ALIGNMENT IN THE SENIOR LEADERSHIP TEAM 2. SEEKING INSPIRATION/FRESH THINKING FROM OTHER SECTORS 3. PEOPLE SKILLS AND COMMUNICATION HRDs 1. STRATEGIC THINKING 2. COMMERCIAL UNDERSTANDING OF THE BUSINESS 3. BUILDING ALIGNMENT IN THE SENIOR LEADERSHIP TEAM 2018 Criticaleye All Rights Reserved

15 CFO Top 5 Priorities for 2018 Retaining key talent and developing skills Digital disruption Innovation Improved performance management Recruiting people with new skills 2018 Criticaleye All Rights Reserved

16 At Criticaleye we believe that great leadership creates positive outcomes and enables powerful legacies. Whatever the strategic direction of your business, it s essential to have an effective, cohesive leadership team in which there is complete trust and alignment. Charlie Wagstaff Managing Director, Criticaleye 2018 Criticaleye All Rights Reserved

17 We Inspire Leaders to Succeed Our bespoke solution supports leaders with personal, strategic and team development. PERSONAL DEVELOPMENT Relationship Manager Board Mentoring TEAM DEVELOPMENT Programme Director Executive Retreats Peer to Peer Connections Events, Calls and Retreats STRATEGIC DEVELOPMENT Pop-up Boards Our unique strength lies in our ability to bring together a wide range of leadership and industry experience. We invite leaders into a trusted environment, where executives and their teams get access to the insight they need to enhance their performance. We enable senior executives to achieve alignment, remove silos and build trust at the senior level Criticaleye All Rights Reserved

18 Inspiring Leaders to Succeed Our Values Respect: an appreciation for diverse and varied views and experiences is crucial to highperformance leadership Collaboration: working together to share knowledge and expertise is a defining characteristic of effective executive teams Challenge: strategies and ideas need to be constructively challenged to reach the best outcome Trust: leaders need to trust their colleagues and peers in order to work effectively and drive results Integrity: we inspire leaders to succeed by providing a closed and confidential environment where Members can share openly To discuss in more detail, please contact: Criticaleye (Europe) Ltd WeWork, Aldwych House Aldwych, London, WC2B 4HN T: +44 (0) Criticaleye (Asia) Ltd 1203/4 Chinachem Hollywood Centre 1-13 Hollywood Road, Central, Hong Kong T: Criticaleye All Rights Reserved